If a company purchases land, paying part with cash and issuing a note payable for the balance, the journal entry to record this transaction will include a debit to Cash.

Question

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The journal entry will include a debit to Land for the total purchase price, not a debit to Cash. Cash would be credited for the amount paid with cash, and a note payable would be credited for the balance.

If a Company Purchases Land, Paying Part with Cash and Issuing